What is End of Service Gratuity in the UAE?
In the UAE, expatriate workers who complete one or more years of continuous service are entitled to an End of Service Gratuity payout when their employment relationship ends.
This gratuity acts as a lump sum retirement payout.
Gratuity Calculation Rules
Under the current UAE Labour Law:
- First 5 Years of Service: You receive 21 days of basic salary for each year of service.
- Service Years Beyond 5: You receive 30 days of basic salary for each additional year.
- Maximum Cap: The total gratuity payout cannot exceed 2 years of basic salary (24 months).
Note: Allowances such as housing, transportation, and health insurance are excluded from the basic salary calculation.
Action Plan: Plan Your Transition
- Check Your Basic Salary: Look at your labor contract to confirm the base salary amount.
- Estimate Payout: Use our UAE Labour Law Gratuity Calculator to check your estimated end-of-service benefit.
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